How To Handle Changes Caused by the Court’s Gay Marriage Decision

Does the Supreme Court know all the paperwork it creates when it hands down some of its decisions?

That’s one of the upshots of the recent ruling that made gay marriage legal in every state. To put it simply, if you have a gay employee who will now be recognized as married in your state, every form that employee has filled out that has a check box for “married or single” needs to be reviewed and probably updated. In some cases, there will be financial implications.

As a small business owner, you probably have a pretty good idea if any of your employees fall into this category. After you’ve done a little research, it would be a good idea to meet with your gay married employees to discuss some of the changes you need to make to be sure everyone is on the same page. Let’s look at some examples.

Payroll. There’s a very good chance that the taxes – especially state income taxes – withheld for newly-legalized gay married employees will change. If the calculations have been done assuming a single status, it may need to be adjusted. Let your employees know the impact a change in marital status would make, if any. They may decide to request a specific amount for income tax withholding purposes.

Benefits. If you offer benefits to employee spouses, you’ll need to include this new group. If you work with insurance brokers or agents on these items, meet with them to make sure you fully understand the situation and your options. When you sit down with your employees, you want to be sure that you really understand the situation and present them with the facts and correct options.

This is probably the area where small business owners are going to spend the most time trying to get a handle on the changes. 401(k) programs, as well as health insurance, life insurance, and family leave benefits will all be impacted by the Supreme Court ruling.

Legacy offerings. Has your business offered “domestic partner” benefits? That category may change. With equal access to marital benefits, some businesses may no longer see a reason to deal with domestic partnerships.

Gay-owned businesses. If you, as a small business owner, are in one of the marriages that is now recognized in every state, your business can be classified as “family owned.” This may have implications if one spouse die, even if the business wasn’t jointly owned before the Supreme Court ruling. Straight couples often work out prenuptial agreements to take care of these complications before they’re standing at the altar. I think it’s safe to say that many gay couples didn’t bother with “pre-nups” because they knew that their home state wouldn’t recognize their marriage anyway.

Dissenters. Just like the Supreme Court decision had dissenters, there are small business owners who will resist aspects of the ruling. At some point, I suspect the Supreme Court will need to rule on which right trumps the other – religious freedom or freedom to wed. A Christian-owned family bakery in Oregon is facing a fine of $135,000 for its refusal to bake a wedding cake for a gay couple and their owners’ public discussion of the issue. While this type of situation will likely be rare, we will undoubtedly hear about other small business owners whose personal beliefs put them at odds with the Supreme Court decision, and other local laws.